DIAMOND PISTON AND RINGS LTD,GHAZIABAD vs. ACIT,DELHI, DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘G’: NEW DELHI BEFORE SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER AND SHRI VIMAL KUMAR, JUDICIAL MEMBER ITA No.1421/Del/2026 (ASSESSMENT YEAR: 2012-13)

Diamond Piston and Rings ACIT, Limited Circle-7(2), 16/867 , Ram Niwas, Joshi v. C R Building, I P Estate Road, Karol Bagh, -110005 New Delhi-110002. PAN-AABCD3171D (Appellant) (Respondent) Assessee by Adjournment Application by Email -Rejected Department by Shri Pramod Kumar, Sr. DR Date of Hearing 24.06.2026 Date of Pronouncement 25.06.2026 ORDER PER RAMIT KOCHAR, AM:

This appeal in ITA No. 1421/Del/2026 for assessment year: 2012-13 has arisen from the appellate order dated 10.12.2025 passed by ld. CIT(A), NFAC, New Delhi u/s 250 of the Income-tax Act, 1961(in Short “Act”) in DIN No: ITBA/NFAC/S/250/2025- 26/1083534559(1), which appeal in turn has arisen from the assessment order dated 03.12.2019 passed by the AO u/s 147 read with Section 143(3) of the 1961 Act. 2. The brief facts of the case are that the assessee is engaged in the business of manufacturing and sale of piston ring and castings. Reassessment proceedings were initiated by the AO for reopening of the assessment u/s 147/148. The details of aforesaid proceedings are enumerated by the AO in its assessment order. The assessee filed return of income in response to notice issued u/s 148, declaring income of Rs. 2,37,88,400/-.

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The assessee participated in reassessment proceedings, and filed replies. The AO observed that the assessee has not filed its return of income originally u/s 139 of the 1961 Act. The AO accepted return of income filed by the assessee in response to notice issued u/s 148 of the 1961 Act. While framing assessment , the AO assessed income at Rs. 2,37,88,400/- and directed interest u/s 234A, 234B , 234C and 234D be also levied. 3. Aggrieved , the assessee filed first appeal before the Ld. CIT(A) . The main grievance of the assessee was wrt chargeability/levying of the interest u/s 234A and 234B. During appellate proceedings, the Ld. CIT(A) issued as many as five notices to the assessee as are recorded in the ld. CIT(A) appellate order. The assessee did not submitted any response/reply before ld. CIT(A) wrt notices dated 24.12.2020 and 26.02.2025, while sought adjournment on three occasions wrt notice dated 11.12.2020 , 03.01.2024 and 18.07.2025. The assessee pleaded before ld. CIT(A) that it is collating information/documents, and sought adjournment. The Ld. CIT(A) proceeded to decide the appeal ex-parte in the absence of reply of the assessee.The ld. CIT(A) while dismissing appeal of the assessee , firstly observed that the assessee has not submitted any response/replies/submissions before ld. CIT(A) and in the absence thereof , the ld. CIT(A) could not adjudicate on the grievance raised by the assessee, and secondly the Ld. CIT(A) observed that the grievance of the assessee is wrt leviability of interest u/s 234A and 234B, and not against the additions made by the AO, and hence remedy lies in by making an application u/s 154 and not by filing appeal with ld. CIT(A). Thus, the appeal of the assessee stood dismissed by ld. CIT(A). 4. Still aggrieved, the assessee filed second appeal with the Tribunal. None appeared on behalf of the assessee when this appeal was called for hearing before the Bench. Adjournment application was filed through email, which was rejected by the Bench. 4.2 Ld. Sr. DR submitted that the assessee did not participated in the appellate proceedings before ld. CIT(A), as the assessee sought adjournments and no response/reply was filed. He relied upon the orders of authorities below.

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computation of interest u/s 234A and 234B . If the ld. CIT(A) simply dismiss the appeal merely because the assessee did not comply with the notices issued by ld. CIT(A) without adjudicating issues arising in the appeal on merits , such order is not sustainable in the eyes of law keeping in view provisions of Section 250(6) , and also higher appellate authorities will be deprived to see what weighed in the mind of the ld. CIT(A) while adjudicating appeal as it will be an order passed without reasoning on the issues on merits. Thus, while adjudicating appeal of the assessee, the ld. CIT(A) has to make independent application of mind to arrive at his own decision/conclusion. The appellate order of the CIT(A) is clearly in violation of section 250(6) of the Act and liable to be set aside. Merely dismissing appeal of the assessee for non-appearance/non-prosecution is not sufficient., and that the assessee has not submitted details/documents during appellate proceedings is not sufficient. The ld. CIT(A) is not toothless as his powers are co- terminus with the powers of the AO, which even includes power of enhancement. The proceedings before ld. CIT(A) are extension of assessment proceedings. It is equally true that the assessee also did not complied with the notices issued by ld. CIT(A) and did not file the requisite details/documents to support his contentions, despite as many as five notices issued by ld. CIT(A). Thus, the assessee is equally responsible for its woes as the assessee did not comply with the notices issued by the ld. CIT(A). Keeping in view the entire factual matrix as culled out above in the preceding para’s of this order, it will be fair to both the parties as well in the interest of justice, that the appellate order passed by ld. CIT(Appeals) be set aside and the matter be remanded back to the file of ld. CIT(Appeals) for fresh adjudication after giving proper opportunity of being heard to both the parties w.r.t. the issues arising in the appeal wrt chargeability of interest u/s 234A and 234B .The assessee is directed to comply with the notice issued by ld. CIT(Appeals) during the appellate proceedings in set aside remand proceedings, otherwise ld. CIT(A) shall be free to decide the appeal ex-parte on merits in accordance with law, after complying with provisions of Section 250(6). We clarify that we have not commented on merits of the issues. Thus, the appellate order passed by ld. CIT(A) is set 4

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aside and matter is restored back to the file of ld. CIT(A) for fresh adjudication. The appeal of the assessee is allowed for statistical purposes. We order accordingly. 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order is pronounced in the Open Court on 25.06.2026

S Sd/- -/- Sd/- (VIMAL KUMAR) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated:25.06.2026